Image: John McCain
Carolyn Kaster  /  AP
Republican presidential candidate Sen. John McCain answers question during an Associated Press interview in New York on Saturday.
updated 7/20/2008 7:21:59 AM ET 2008-07-20T11:21:59

Faced with a spending cap for his fall campaign, Republican presidential candidate John McCain is aggressively spending more money than he is raising during summer months and methodically reducing his cash reserves.

McCain raised more than $21 million in June and spent nearly $26 million, the campaign reported Friday night. McCain eroded his cash on hand, ending the month with $27 million in the bank. He began the month with $31.6 million in hand.

According to filings with the Federal Election Commission, McCain spent more than $16 million on advertising during the month, about three-quarters of his total raised in June. That was five times more than he spent in May, when the Democratic presidential primary was still being contested by Barack Obama and Hillary Rodham Clinton. Obama clinched the Democratic nomination on June 3.

McCain plans to accept public financing for the general election — an $84 million infusion that prevents him from raising private money for his fall campaign. That means he has to spend all the money he raises between now and the Republican national convention in early September.

Obama raising own money
Obama has decided to bypass the public finance system and raise his own money for the fall.

"Our strategy is that we will pay down all our primary funds toward the end of August to the point where we we'll have no more primary funds available," McCain campaign manager Rick Davis said last week. "Up to this point we have been accumulating capital; now we will start spending down that capital."

Obama has not yet filed his June report with the Federal Election Commission. It is due at midnight Sunday.

But Obama announced this week that he raised $52 million in June, more than twice what McCain raised. Overall, Obama has raised about $340 million to McCain's nearly $140 million.

McCain's campaign announced his fundraising and cash on hand figures last week. But his FEC report offered more details about the nature of his spending and his fundraising.

McCain increased his spending on payroll in June by 9 percent to nearly three-quarters of a million dollars a month. The campaign has been expanding its presence in some states.

Overall, McCain's spending, more than twice what he spent in May, exceeded his fundraising in June by more than $4 million.

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Spend now or later?
Obama, who has been able to outraise all his opponents, must calculate how much money to spend in the summer and how much to save for use in the fall. For now, he appears to be matching McCain's spending and saving as well. While McCain was spending much of his money on advertising, however, Obama appears to have focused on expanding his staff presence in battleground stats. Obama entered the month with $46.5 million in the bank and ended up with $72 million. About $12 million of that can only be used in the fall.

At this stage of the campaigns, money raised by the national political parties is as important as that raised by the candidates.

The Republican National Committee raised $26 million in June. The Democratic National Committee raised $22 million.

Altogether, the RNC and McCain had $95 million in the bank at the end of the month. Obama and the DNC had $92 million.

June was the best fundraising month of the Arizona senator's campaign, slightly exceeding his May fundraising. The increase was due to a better performance by a joint fundraising committee that McCain set up with the Republican National Committee.

McCain also reported debts of more than $1.4 million.

The most frequently cited occupation among McCain donors was "retired," a group that contributed $2.8 million in June and that accounts for at least 14 percent of his fundraising. Retirees figure highly in Obama's list of contributors as well, but lawyers lead among Obama donors. Retirees make up about 6 percent of his contributors.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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